Earnings season provides some transparency in an otherwise turbulent market. That’s because anyone, from professional fund managers to casual day traders, gets access to the same financial information at the same time.
It’s important to recognise that earnings season can be volatile; share prices can experience major spikes in a single day of trading. The financials that companies report will reveal how healthy their finances are, and possible investments or growth strategies they plan to employ. CMTrading CEO Daniel Kibel shares his thoughts on the earnings season and highlights trends for SA traders. “Earnings season is when companies announce how much they actually made as opposed to what’s expected. If Amazon is expecting revenue of $111bn and their actual results are $113bn, that’s much better for the company and its stock will rise because it’s a considerably better result than forecast. On the other hand, if it was to go below $110bn then that would be bad as its stock would drop.
“If you want to make money in stocks, now is the time to do so, as the earnings season is when major companies see their stocks really move in the market.” “Know what you’re getting yourselves into; don’t risk what you can’t afford. Understand thatis the time to trade. The financial world will be looking at company earnings and trading the earnings season is great as the market moves with high volatility.